As a seasoned cryptocurrency analyst with over a decade of experience observing market trends, I have seen numerous cycles where Bitcoin dominance has taken a backseat to altcoins. The current trend of Bitcoin dominance increasing since September 2022 is impressive, but it’s important not to overlook the potential for a reversal.
The increasing prevalence of Bitcoin in the cryptocurrency market since last September 2022 is a topic of interest. However, there’s speculation as to whether this upward trend will change direction. With altcoins, the question becomes: Is now the opportune moment to begin amassing positions?
Bitcoin has outperformed
If you hadn’t invested in a select few high-performing altcoins since the onset of the current crypto bull market, which began in September 2022, your investment would have been more profitable if you had simply held onto Bitcoin ($BTC). Bitcoin has surpassed the overall cryptocurrency market by approximately 40%. Only a few altcoins, such as Solana ($SOL) and Render Token ($RNDR), along with memecoins like Pepe Coin ($PEPE) and Dogecoin ($WIF), have managed to outperform Bitcoin.
Bitcoin dominance rolling over
Since mid-April, the Bitcoin Dominance chart indicates a shift in trend with dominance beginning to decrease. It’s important to note, though, that this could be the initial stage of a flag formation. If that is the case, the price may rebound and continue its upward trajectory as it remains within an uptrend. Nevertheless, significant resistance at the 57% level might hinder any further dominance gains if this occurs.
Bitcoin dominance loses long-term wedge pattern
From a broader perspective of a weekly chart, Bitcoin’s dominance has recently departed from its long-term wedge shape. With dominance nearing the peak of the wedge, it was expected to either surge upwards or decline, and historically, such patterns tend to break downwards. Consequently, this is what transpired.
Is an altcoin season on the horizon?
When it comes to potential thresholds for Bitcoin’s market supremacy, there exist numerous levels of support starting from 49% and below. Among these, the range between 50% and 49% is likely to offer the most robust support.
With Bitcoin’s dominance at approximately 55% now, a decrease could pave the way for altcoins to gain ground significantly. This situation might signal the arrival of an “altcoin season.” After Bitcoin’s extended period of prominence over the past year and a half, the potential for altcoins to regain strength is certainly plausible – but careful selection is crucial.
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2024-07-16 19:32